Can you actually get a refund on a loan if it was unaffordable at the start?

PageB

Hi all, I took out a loan 6 months ago when I had no choice because I lost my job due to covid cut backs and I needed to pay rent. I haven't been able to make even the interest payments from the start and it's just building and building. 

A friend told me that if a loan company grants you a loan when you're clearly unable to pay it back that you might be able to get a refund, is that true? 

[Deleted User]

You can make a mis-selling complaint if you feel you were mis-sold. But beware of having mis-bought instead, especially if you mis-represented your situation.

You can't get a refund as you haven't yet paid anything. However, the loan should also be on the verge of defaulting, so the interest will stop.

WilfredB

Hi Page, 

This is true in concept but of course it varies case by case. 

The FCA has certainly been clamping down on unfair lending practices in the last decade and sometimes people are eligible for refunds in response to 'predatory lending' from loan companies. 

I can't really grasp a full understanding of your situation without further explanation but you may be able to find the answer yourself on whether you are eligible for a refund on your loan here. If your circumstance does match then it will walk you through what actions to take next. 

What was the company you took a loan from?

y3sitsm3

PageB said:

Hi all, I took out a loan 6 months ago when I had no choice because I lost my job due to covid cut backs and I needed to pay rent. I haven't been able to make even the interest payments from the start and it's just building and building. 

A friend told me that if a loan company grants you a loan when you're clearly unable to pay it back that you might be able to get a refund, is that true? 

How were you "clearly" unable to pay it back?

Did you tell them you'd lost your job?  Or did you tell them you were still employed?

Exodi

If you had declared no job/no income, yet they still lended you the money despite this, then it's a pretty open-and-shut case for mis-selling.

If you have lied about your employment circumstances on the loan application, then it's closer to fraud than mis-selling.

Obviously there is some burden of responsibility on the borrower also - and you seem to have been aware you could not afford to pay it back, even from the outset.

There is a lot of misinformation that you can just borrow money and if you can't afford to pay it back, you've automatically been mis-sold.

Thrugelmir

PageB said:

A friend told me that if a loan company grants you a loan when you're clearly unable to pay it back that you might be able to get a refund, is that true? 

Were you honest about your circumstances when you made the application for the loan?  Understandable that people do stupid things in times of desperation. Unfortunately by doing so they have to accept and learn to live with the consequences. 

maxsteam

Talk to your local Citizens Advice Bureau, or another similar organisation, and they will talk you through the process to, at least, stop interest being added to the loan. If you do nothing, the situation will escalate.

"A friend told me" or "I read it on a forum" are not formal processes.

y3sitsm3

maxsteam said:

Talk to your local Citizens Advice Bureau, or another similar organisation, and they will talk you through the process to, at least, stop interest being added to the loan. If you do nothing, the situation will escalate.

"A friend told me" or "I read it on a forum" are not formal processes.

Not sure why you keep bumping these old threads, the OP's don't seem open to answering questions.